If Saudi Arabia has invested substantially more money in foreign countries than foreigners have invested in Saudi Arabia, then we might expect Saudi:
A. GNP to exceed Saudi GDP.
B. net foreign factor income to be negative.
C. GDP to exceed Saudi GNP.
D. net foreign factor income to be zero.
Answer: A
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If a Pigovian tax is not large enough, the resulting market quantity:
A. will be equal to the efficient quantity. B. will be more than the efficient quantity. C. will be less than the efficient quantity. D. will be where the social marginal cost equals the social marginal benefit.
Suppose the United States can produce either 1 ton of potato or 0.5 tons of wheat per worker per year, while Ireland can produce either 3 tons of potatoes or 2 tons of wheat per worker per year. There can be mutual gains from trade if: a. the United States specializes in potatoes because of its comparative advantage in producing potatoes
b. the United States specializes in wheat production because of its absolute advantage in producing wheat. c. the United States specializes in wheat production because of its comparative advantage in producing wheat. d. the United States specializes in potatoes because of its absolute advantage in producing potatoes.
Sulfur Dioxide Discharged (Tons)Firm AFirm B10$10,000$12,000911,00017,000813,00022,000716,00026,000620,00033,000Table 16.4Table 16.4 shows the production cost for two utilities at different levels of sulfur dioxide emissions. Assume that the government issued 8 marketable pollution permits to each firm. If Firm B wants to purchase a second permit to be able to discharge 10 tons of sulfur dioxide, what is Firm B's willingness to pay?
A. $2,000 B. $3,000 C. $4,000 D. $5,000
Suppose that in 2020, the total value of all final services produced in a nation was $300 billion; the total value of all final goods produced in that nation was $500 billion; and the total value of all final goods and services produced by that nation's firms in other countries was $300 billion. Gross domestic product (GDP) was
A. $500 billion. B. $1,100 billion. C. $900 billion. D. $800 billion.